How Vinted Works and Makes Money
Vinted is a P2P mobile social marketplace for pre-loved clothing. As one of the most successful start-ups in the Baltic countries, Vinted is aiming to change the shopping habits all over the world, making second-hand the first choice.
What Is Vinted?
Founded: December, 2008
Country: Lithuania
Total Equity Funding: $59.59M in 3 Rounds from 3 Investors
Employees: 101–250
Vinted is a secondhand clothing marketplace. So if you have a dress or any other clothing that you simply don’t wear anymore (for whatever reason), you can create a profile on Vinted, put together a listing for the chosen clothing complete with photos and descriptions, and then wait for prospective buyers to check it out. If another Vinted user likes the clothing and agrees to the price you’ve set, then they simply purchase the clothing, pay for shipping, and then wait for it to arrive in the mail. Vinted gives the seller a prepaid shipping label, making it easy to send the dress to the buyer. After the transaction is completed, the seller keeps all the money for the dress, minus a small fee to Vinted.
How Vinted Makes Money
Vinted charges sellers a $1–5 (or 19%) fee on every item of clothing successfully sold in its marketplace. Last year's revenue was around $5 M. Today, Vinted has attracted 12 million members, with another 11,000 joining daily. Additionally, the marketplace now has 22.3 million items listed, with 90 new items listed every minute. The company also says an item is sold on the site every 49 seconds.
User Experience
My short opinion about Vinted: it’s absolutely orientated for female users, so for men, there is very little stuff to find. In fact, I have never been a huge fan of buying clothes online (I’m the kind of guy who likes to touch and try on clothes before buying), but seems they were lucky to find users among young females who like the idea to buy second-hand online. They have an app and desktop version. The app seems pretty solid and easy to use, but the desktop version I found out a little bit old-fashioned. From the seller’s point, it works really easily. Once a buyer has paid for an item you get a notification. You then send the shipping label to your email, print it, tape it to your package and drop it at the post office. Once the buyer has confirmed they have the item, the funds are released to you so you can transfer it to your bank. You and the buyer can leave feedback for each other and move on.
Potential Future Value
It seems that Vinted wants to dominate the online second-hand market around the globe, but they have struggled with expansion into the crowded US market and now have covered only a few EU markets. Recently they announced about the redundancy of employees and moving most operations to Germany, there is biggest Vinted market yet. Obviously, they need to improve brand awareness. For some reason, they still run under few other brands in different countries and it’s not the best decision if you want to spread into international waters.
Let’s put some numbers here. By some reports total second-hand resale market is around $8 billion only in the USA. By the year 2025 global market expected to reach $25-$30 billion. 82% of that market should be covered by online players such as Vinted. So this is not your grandma’s thrift store anymore. High-quality resale is a multi-billion dollar industry and is among the fastest-growing segments in retail. If Vinted will make smart investments into an expansion, brand awareness, and attraction of a male segment they can make a big bite off the global online second-hand resale market.
Competition level: High (10> competitors)
Current Vinted valuation (unofficial): $100–150M
Chances to become unicorn: Mediocre
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